One year later, Mississippi business has changed

In the year following the first successful large-scale international terrorist attacks on the continental U.S., much has happened to change the physical, political, emotional and financial landscape of the nation and Mississippi. The aftermath of the terrorist attacks changed the military, security and insurance sectors dramatically, and dealt a huge blow to the tourism industry.

“The tragedy has spurred a lot of defense spending, which indirectly has been beneficial to a lot of Mississippi defense industries, such as Raytheon in Forest, where a lot of army supplies, like a personnel location system used to identify friendly forces in battlefield situations, are made,” said U.S. Sen. Thad Cochran (R-Miss.), senior member of the appropriations panel. “A lot of technologies and defense industries in Mississippi will continue to be important in our effort to defeat the terrorists and make the world safe against terrorism.”

State economist Phil Pepper, Ph.D., said the terrorist attacks pushed back the national recovery — and Mississippi’s — by about six months.

“As a result, we’ve seen continued slow revenue collections for the state, even today,” he said. “When you combine 9/11 with the Enrons and WorldComs, and the continued slowdown in the manufacturing sector, it adds up to a slow growth economy.”

Jerry McBride, president of the Mississippi Manufacturing Association, agreed that “Sept. 11 definitely slowed things down,” but added, “I can’t say there’s been a definitive shift in our industry in the past year because of it.”

Security changes in the national airport transportation system since

Sept. 11 have had “perhaps the biggest impact,” said Cochran, “and that’s still an ongoing process.”

Mississippi’s gaming industry was hard hit initially, but is holding up “reasonably well,” said Pepper. While tourism in Mississippi took a dip last fall, it has rebounded nicely, said Darienne Wilson, state tourism director. For the fiscal year that ended June 30, state tourism revenues were 3% above the previous year, “primarily because the state is a drive market,” she said.

In Tunica County alone, tourism grew 1.5% last year, said Webster Franklin, president of the Mississippi Tourism Association and executive director of the Tunica Convention & Visitors Bureau. “Given the economy and the fact that Tunica is a fly/drive destination, we feel very fortunate to have sustained that small level of growth,” he said. “We haven’t seen a decline in revenue like most traditional tourism destinations have.”

Insurance needs help

Congress has pumped a good bit of money into the airline industry, but has done nothing for the insurance industry, said state insurance commissioner George Dale.

“In fact, because of reinsurance problems, we’ve asked Congress to enact a terrorism program that will allow insurance companies to have a backup for any act of terrorism,” said Dale. “They have not done that. The American insurance industry is in a dilemma because it is required to buy reinsurance from companies like Lloyd’s of London — all overseas reinsurers — that have told us they don’t want to cover acts of terrorism. But there’s no definition of terrorism. Is it somebody exploding firecrackers in somebody’s mailbox? Or blowing down a skyscraper? If there’s no definition, and if overseas reinsurers are charging more, tightening their underwriting and trying to exclude terrorism, what do the American insurance companies do? It’s having an effect — higher price, less availability — on the American insurance market.”

Because Mississippi is such a small player in the overall insurance scheme, the state primarily inherits problems from other states, said Dale. “So Mississippi is in the same boat with everyone else,” he said. “We need some time to lapse and not to have any other major terrorism situations like the Trade Center.”

Profound impact on agribusiness

The tragic events of Sept. 11 have had a profound effect on agribusiness, said Dr. Lester Spell Jr., commissioner of the Mississippi Department of Agriculture and Commerce.

“From the producer to the distributor to the user of agricultural products, precautionary steps dealing with agricultural products and equipment, as well as exotic pest introductions, have been implemented to promote homeland security and the protection of the state and the nation’s food and fiber supply,” said Spell.

For example, at retail outlets where both pesticides and fertilizers, which can be used as bomb-making material, are sold, distributors have implemented proactive, voluntary measures designed to provide additional security of these products, such as installing perimeter fences and nighttime lighting, placing pesticides and some fertilizers, such as ammonium nitrate and urea, under lock-and-key, verifying the identification of individuals more closely by requiring licensing and applicator certification documentation before sales of restricted-use products are made, and keeping detailed product inventories, with some distributors reporting these inventories to local law enforcement and emergency personnel, said Spell.

“Combined, these efforts add many layers of security to the distribution of these types of products, which ultimately leads to the security of both our nation and its agricultural commodities,” said Spell.

Aerial and ground applicators in Mississippi have also implemented voluntary measures to prevent the use of pesticide application equipment as a weapon that would threaten the security of the state-securing equipment by removing propellers from aircraft or chaining airplane propellers, building specialized storage facilities for equipment and pesticides that are locked when not in use, reporting applications to local law enforcement authorities, advertising the application of fertilizer to large tracts of land in local newspapers prior to the event, and filing flight patterns with local authorities, said Spell.

“Additional steps have also been taken by the Mississippi Department of Agriculture and Commerce to better enhance the management and stewardship of agricultural products,” he said. “Regulatory inspections at facilities, where these products are stored and used, emphasize record keeping, proper storage, use and disposal. We are committed to taking a proactive approach to the protection of the industry’s products and hence the food supply. There is no value in being only reactive.”

In addition to agricultural products, officials are “beefing-up” monitoring programs for exotic pests, some of which could be introduced into existing crops, said Spell.

“Plant regulatory officials have been challenged to recognize the pathways of introduction of these destructive pests,” he said. “Consequently, increased efforts are now being made to monitor potential pathways for the introduction and spread of harmful biological agents capable of harming our crops. Agricultural production is our investment in our soil and crops, as well as our cultivating, harvesting and chemical application equipment. We realize that all of these form the basis for agriculture and the production of food for consumption, feed and export and that we must protect it from potential threats.”

Mississippi technology responds

A week after the terrorist attacks, Dr. Angeline G. “Angie” Dvorak, then president and CEO of the Mississippi Technology Alliance, told business leaders at a banquet for the Economic Development Authority of Jones County that the answer to a key question, ‘What will technology’s role tomorrow be?’ would be vital to the state.

“Our stat
e is hom
e to 50% of all the Department of Defense’s supercomputing capacity,” Dvorak said last September. “Part of our encouragement is for communities to take a moment and focus on technology-based economic development.”